Indian Stock Market

Kojam Finvest Limited is listed on BSE and NSE. Kojam is a pure holding company owning a 54% stake in Gujarat Glass Limited. Gujarat Glass has focused on being the leading provider of “flaconnage” (glass containers for the quality conscious pharmaceutical and cosmetics industries). GGL enjoys a leadership position in the niche pharmaceutical packaging segment that it operates in. GGL is the only company in India and one of the few in the world who manufacture and market the entire pharma range of glass bottles and vials (amber and flint, bottles and vials, sodalime and borosilicate).
Sonia Sharma: GGL has 3 manufacturing facilities - in Kosamba, near Surat, about 300 kms. northwest of Mumbai, Jambusar near Baroda, about 100kms beyond Kosamba, and at Ratmalana, in Sri Lanka. Jambusar plant is the world’s largest pharma amber bottles manufacturing plant at a single location. In all, the 7 furnaces of the company with 27 automatic production lines, many of which are electronically controlled state-of-the-art machines, produces 7 million glass bottles and vials every day throughout the year for quality conscious customers in the healthcare and cosmetics industry. Power is an important input in glass manufacturing. To ensure regular and high quality power supplies, Gujarat Glass has two natural gas based captive power plants at Kosamba and Jambusar to meet its power requirements. It ha For the year ended March 31, 2007, GGL’s sales were Rs 400 crs, EBIDTA Rs 105 crs and PAT Rs 35 crs and an EPS of 22. Kojam currently trades at abt 200 / share with a mkt cap of 200 crs. Transaction Kojam is under the process of merger with GGL. Shareholders of Kojam will receive 1 share in GGL for every 1 share held in Kojam. Value Proposition 1. All investment companies are typically traded at a discount of 50% to the underlying investments. (eg. Balmer Lawrie, Consolidated Finvest, Jindal South West Holdings, Tata Investment Corporation etc..). On merger this discount will disappear as Gujarat Glass will be a operating company. Implied value on listing Rs 400 / share 2. Assuming a trailing PE Ratio of 18, price per share works out to Rs 396. There will be no dilution in the There will be no dilution in the equity of GGL on account of the merger….. a clear upside of 100% in the next four months…. The Bombay High Court has approved the merger scheme on Aug 10, 2007